The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Yext (YEXT). YEXT is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 14.61 right now. For comparison, its industry sports an average P/E of 19.90. Over the past year, YEXT's Forward P/E has been as high as 21.17 and as low as 10.89, with a median of 12.56.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. YEXT has a P/S ratio of 1.24. This compares to its industry's average P/S of 1.7.
Finally, investors will want to recognize that YEXT has a P/CF ratio of 26.83. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. YEXT's current P/CF looks attractive when compared to its industry's average P/CF of 34.29. YEXT's P/CF has been as high as 227.93 and as low as -1262.83, with a median of 106.38, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Yext is likely undervalued currently. And when considering the strength of its earnings outlook, YEXT sticks out as one of the market's strongest value stocks.
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.
Free: See Our Top Stock And 4 Runners UpYext (YEXT) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
